Infineon Technologies swings to profit, raises outlook

PolyaLesova

FRANKFURT (MarketWatch) -- German chip maker Infineon Technologies AG raised on Wednesday its full-year revenue and investment outlook, as it reported a return to fiscal third-quarter net profit and a 59% surge in revenue.

In the three months ended June 30, Infineon swung to a net profit of 126 million euros ($164 million) from a loss of €24 million in the same period a year ago.

Revenue soared to €1.2 billion from €761 million.

The results beat market expectations. Analysts projected net profit of €104 million and revenue of €1.13 billion, according to a survey by Dow Jones Newswires.

Shares of Infineon (IFX)
IFNNY, -0.77%
gained 2.1% in Frankfurt trading, making the firm one of the top gainers in Germany's blue-chip DAX index (DAX), which finished down 0.5%.

Infineon's shares have soared 95% over the past 12 months.

The firm raised its outlook Wednesday, saying it now expected revenue to grow at least 40% in fiscal 2010 compared to the previous year. It had previously forecast growth of 30%. The full-year segment-result margin is expected to be a low-teens percentage.

Infineon also anticipates investments of more than €400 million, up from an earlier guidance of more than €300 million.

"After a challenging 2009 fiscal year, we are executing extremely well in the current up-cycle," said Chief Executive Peter Bauer in a statement.

"We have come a long way in improving profitability and are now beginning to take aim at our ambitious goal of 15% and greater overall segment-result margin," he said.

The firm's segment-result margin in the third quarter reached 13.5%, in line with guidance and up from 10.6% in the prior quarter.

Neubiberg-based Infineon supplies the car industry with sensors, microcontrollers and power semiconductors. It also makes components for the industrial electronics market, offers chip card and security applications and manufactures chips for wireless-communications devices, such as Apple Inc's
AAPL, +0.21%
iPhone.

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